You could get a personal loan from a friend or family member to help catch up on payments or reinstate your loan. You would need to be able to pay your mortgage (& the personal loan) back on time each month afterwards. This is usually the best option for homeowners who are not far behind their payments and had a short term loss of income and will soon regain enough income to pay their debts.
Can you qualify to refinance your current loan(s) so that the payments are lower and amortized over a new 30 year period? You will likely need good credit scores and current income as well as low debt, or could pay off some of the revolving debt with your refinance if you have a lot of equity in your home. You will need to consult a good mortgage lender for help with this.
Will your current mortgage company work with you on a forbearance or a loan modification? This often has a negative effect on your credit report (but not nearly as bad as a foreclosure) so be certain you have explored options 1 & 2 first. Contact your current mortgage company/note holder to see what options they can offer and if they are willing to work with you. You may have to do a trial period to show that you can make 3 monthly payments at the new modified amount and the company may also require proof of a financial hardship to qualify for a modification. There may be restrictions on the amount of money you can have in reserves/savings accounts.
This does not always work if you are short on time and the foreclosure sale date is approaching soon but will often get you the most money for your home. You must be able to sell your home and get enough money to pay off all of your home mortgage(s), liens against your home, HOA fees, and any taxes you owe as well as money for closing costs, and realtor fees. This also usually requires having your home be in top condition to get top dollar and you must allow showings, open houses, inspections, etc.
This is often the best way to sell your home fast!
This is what our company does. We buy homes from people that need to pay off their homes before foreclosure is finalized. This keeps the foreclosure off their credit report and can even give them money to start over again (depending on the equity in the home and debt owed). This gets you paid cash for your home and your home's debt gets paid off and prevents foreclosure from destroying your credit report. We can often close much faster than listing your home with a realtor and we don't need you to repair the home or get it "show ready". Sometimes we can even pay for the closing costs. Each property is different just like each home owner's situation is different.
You will need to find a different place to live and we understand that you may not want to sell your home. However, sometimes it is better to get a fresh start than not face reality and be forced to move. If your home is sold at foreclosure auction and you don't sell your home on your own, you will be forced to start over with a foreclosure on your credit report for 7 years. Foreclosures are bad! This can sometimes trigger your credit card company to raise your interest rate because they now see you as a higher risk. It can stop you from qualifying to rent a home, and any debt you need to apply for, like a car loan, will usually have much higher rates and payments than if your credit report did not show a foreclosure. And you won't likely be able to get a mortgage to buy another home for 7 years. You want to avoid foreclosure if at all possible!
The bank may allow you to give them ownership of the home in exchange for release of loan debt but this does not often happen and will only work if you have only one home loan and no other debt against your property. Your credit score will be greatly affected negatively and only slightly less than foreclosure. This is a last attempt to avoid foreclosure or bankruptcy after all previous options have been tried.
This is the last resort if all of the above options have been exhausted and you cannot sell your home. You will need to consult a bankruptcy attorney and have them file for you. They can also tell you your options between the different types of bankruptcy. If possible, you do not want to foreclose or file bankruptcy! They both have very negative impacts on your credit score and limit your ability to get future loans and make your interest rates and payments be much higher than if you can sell your home and pay off debt. Please consider all options and act with a sense of urgency. You may not want this to be happening, but wishing it away won't stop the foreclosure.
We know this is a stressful situation for you and hope that some of these options help you and your family move forward in the best way possible. Let us know if you would like us to consider buying your property.
(Diclaimer: We are not attorneys, realtors, or accountants and cannot give legal, credit, or tax advice. This information should be viewed as opinions/ideas and you should consult a professional for advice pertaining to your specific situation and your location to follow all local and state laws. Your county Clerk of Court office is a good place to start with questions about the foreclosure process in your area/state).
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